by Beverly Meyer and Benjamin Reeb, Bricker Graydon LLP
On January 5, 2025, Former President Biden signed the Social Security Fairness Act (SSFA), H.R. 82, into law. The SSFA, which garnered bipartisan support in Congress, repeals certain provisions of the Social Security Act that reduced Social Security benefits for school employees and other public service employees. Specifically, the SSFA repeals the Government Pension Offset (GPO) and the Windfall Elimination Provision (WEP), two separate provisions that reduced Social Security benefits for public sector employees and their eligible family members if the employee received or was entitled to a pension based on earnings from their public employment.
In particular, the WEP reduced Social Security benefits for individuals who earn a pension from work not covered by Social Security but who also have qualifying earnings from jobs that are covered by Social Security. The GPO is similar to the WEP, but it reduced Social Security spousal and widow(er) benefits of individuals who earned a pension from work not covered by Social Security.
The WEP and GPO have both been in effect for over forty years, reducing the Social Security benefits of many workers, spouses, and surviving spouses who received a pension based on employment not covered by Social Security —including school district employees—during that time. With the repeal of these provisions, eligible school district employees and their spouses and survivors may realize increased Social Security benefits, which will be applied retroactively to payments beginning in January 2024.
According to the Congressional Research Service, approximately 2.5 million Social Security beneficiaries had benefits reduced by the WEP, the GPO, or both as of December 2023. In Ohio alone, over 230,000 Ohioans saw reductions in benefits under these two provisions. With the SSFA’s repeal of the WEP and GPO, these individuals will now realize their full, earned Social Security benefits. The Social Security Administration (SSA) anticipates that some eligible individuals will see very little increase in their monthly benefits while others may realize more than a $1,000 increase each month.
As noted, the SSFA garnered bipartisan support in Congress, and there do not appear to be any impending challenges to the law at this time. However, questions still remain regarding its implementation. The Social Security Administration has not yet fully addressed how it will implement the SSFA, including the calculation and payment of increased benefits and retroactive lump sums to Social Security beneficiaries, but it has released an FAQ on its website. It will be important for retirees and current school employees to remain informed about its implementation and any watch for the release of additional information from the SSA. Bricker Graydon will continue to watch for updates as well and communicate notable items having general application.